Commentary Magazine


Posts For: May 25, 2011

Auditing Autocracies

This past weekend, in London, I picked up a copy of the Independent and this article about corruption in Afghanistan and, more specifically, the theft of $1 billion from the Kabul Bank caught my eye.

In Iraq, Afghanistan, and elsewhere in the Middle East, the news media focuses on terrorism. Television cameras don’t lie, but they also seldom show the full perspective. Even during the height of the insurgency in Iraq, for example, terrorist attacks were localized and most of the country—Iraqi Kurdistan and the Shi‘i south, for example—remained relatively free from violence. To the American television audience, however, bombs were going off everywhere and it was impossible to walk 100 feet anywhere in Iraq without getting shot.

Terrorism—even at its worst—only directly hurts a small fraction of the people living in Middle Eastern societies, those unlucky to be in the wrong place at the wrong time. Corruption, however, affects nearly everyone—hence the Arab uprisings. Back in 2005, I wrote a piece in Lebanon’s excellent Daily Star on corruption, arguing that the failure of our allies to counter it allows Islamists more fertile ground to recruit.

While I’ve often criticized the Iraqi Kurdish administration for corruption (and received death threats because of my criticism), the Kurdistan Regional Government counters that they have engaged PricewaterhouseCoopers to aid transparency, efficiency, and to combat corruption. Sadly, buried in the article about the massive fraud at Afghanistan’s Kabul Bank was this:

The document points the finger at the former chairman and the former chief executive of Kabul Bank, and criticizes the top accountancy firm Deloitte for not doing enough in response to allegations of corruption at the bank. It also highlights how auditors from PricewaterhouseCoopers (PwC) failed to spot any signs of fraud.

PricewaterhouseCoopers appears to have become to emerging Middle Eastern states what Arthur Andersen was to Enron. The point is not to single out an accountancy firm, however, but rather to highlight how, when it comes to corruption in the region, the niceties of Western accountants sifting through paperwork is never going to work. Firms must recognize this, and woe to those that allow their names to be used as cover for corruption. More importantly, if the region is going to emerge from the disaster which poor governance and corruption has bestowed upon it, there needs to be a serious discussion about corruption and foreign aid. The worst thing that could be done is simply to throw more money at the problem.

This past weekend, in London, I picked up a copy of the Independent and this article about corruption in Afghanistan and, more specifically, the theft of $1 billion from the Kabul Bank caught my eye.

In Iraq, Afghanistan, and elsewhere in the Middle East, the news media focuses on terrorism. Television cameras don’t lie, but they also seldom show the full perspective. Even during the height of the insurgency in Iraq, for example, terrorist attacks were localized and most of the country—Iraqi Kurdistan and the Shi‘i south, for example—remained relatively free from violence. To the American television audience, however, bombs were going off everywhere and it was impossible to walk 100 feet anywhere in Iraq without getting shot.

Terrorism—even at its worst—only directly hurts a small fraction of the people living in Middle Eastern societies, those unlucky to be in the wrong place at the wrong time. Corruption, however, affects nearly everyone—hence the Arab uprisings. Back in 2005, I wrote a piece in Lebanon’s excellent Daily Star on corruption, arguing that the failure of our allies to counter it allows Islamists more fertile ground to recruit.

While I’ve often criticized the Iraqi Kurdish administration for corruption (and received death threats because of my criticism), the Kurdistan Regional Government counters that they have engaged PricewaterhouseCoopers to aid transparency, efficiency, and to combat corruption. Sadly, buried in the article about the massive fraud at Afghanistan’s Kabul Bank was this:

The document points the finger at the former chairman and the former chief executive of Kabul Bank, and criticizes the top accountancy firm Deloitte for not doing enough in response to allegations of corruption at the bank. It also highlights how auditors from PricewaterhouseCoopers (PwC) failed to spot any signs of fraud.

PricewaterhouseCoopers appears to have become to emerging Middle Eastern states what Arthur Andersen was to Enron. The point is not to single out an accountancy firm, however, but rather to highlight how, when it comes to corruption in the region, the niceties of Western accountants sifting through paperwork is never going to work. Firms must recognize this, and woe to those that allow their names to be used as cover for corruption. More importantly, if the region is going to emerge from the disaster which poor governance and corruption has bestowed upon it, there needs to be a serious discussion about corruption and foreign aid. The worst thing that could be done is simply to throw more money at the problem.

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Re: If Only Elections Were More Like 1800!

I agree wholeheartedly with Pete regarding the remarkable relationship that developed between Adams and Jefferson after the bitter election of 1800. The letters between them in their old age are fundamentally important primary historical source material, and unlike a lot of important historical source material, they are a pleasure to read.

There are two other remarkable things about the election of 1800. It was, as far as I know, the first time in all history that a head of state was defeated in a popular election and accepted, without resistance, the decision of the electorate. On March 4th, 1801, John Adams left the White House and began his journey back to his home in Massachusetts by public coach. Today, such an event is commonplace, at least in the United States if not the Third World where democracy has often turned out to operate under the principle of one man, one vote, one time. In just the last 35 years no fewer than three presidents have been turned out of the White House by the people and simply went home (although in fancier transportation than a public coach). But in the world of the Founding Fathers, Adams’s action set a powerful precedent. No wonder the European intellectuals of the time regarded the American experiment in self-governance as so astonishing.

The other hero of the election of 1800 is Alexander Hamilton. Through a flaw in the design of the Constitution (they didn’t make many!) later corrected by the 12th Amendment, Thomas Jefferson and Aaron Burr (the Jeffersonian candidate for vice president) tied in the Electoral College, throwing the election into the House of Representatives. Hamilton, who had clashed repeatedly and deeply with Jefferson while they both were members of George Washington’s cabinet, had no love for the Virginian. But Hamilton had no respect for the utterly amoral Burr. A pettier man might have used his considerable influence with Federalist members of the House to deny Jefferson the presidency out of spite. But Hamilton did no such thing. He urged his followers to vote for Jefferson. It was the noblest moment in Hamilton’s public career. It could be argued, I suppose, that it even cost Hamilton his life. The most famous duel in American history would never have taken place if Burr had been president.

I agree wholeheartedly with Pete regarding the remarkable relationship that developed between Adams and Jefferson after the bitter election of 1800. The letters between them in their old age are fundamentally important primary historical source material, and unlike a lot of important historical source material, they are a pleasure to read.

There are two other remarkable things about the election of 1800. It was, as far as I know, the first time in all history that a head of state was defeated in a popular election and accepted, without resistance, the decision of the electorate. On March 4th, 1801, John Adams left the White House and began his journey back to his home in Massachusetts by public coach. Today, such an event is commonplace, at least in the United States if not the Third World where democracy has often turned out to operate under the principle of one man, one vote, one time. In just the last 35 years no fewer than three presidents have been turned out of the White House by the people and simply went home (although in fancier transportation than a public coach). But in the world of the Founding Fathers, Adams’s action set a powerful precedent. No wonder the European intellectuals of the time regarded the American experiment in self-governance as so astonishing.

The other hero of the election of 1800 is Alexander Hamilton. Through a flaw in the design of the Constitution (they didn’t make many!) later corrected by the 12th Amendment, Thomas Jefferson and Aaron Burr (the Jeffersonian candidate for vice president) tied in the Electoral College, throwing the election into the House of Representatives. Hamilton, who had clashed repeatedly and deeply with Jefferson while they both were members of George Washington’s cabinet, had no love for the Virginian. But Hamilton had no respect for the utterly amoral Burr. A pettier man might have used his considerable influence with Federalist members of the House to deny Jefferson the presidency out of spite. But Hamilton did no such thing. He urged his followers to vote for Jefferson. It was the noblest moment in Hamilton’s public career. It could be argued, I suppose, that it even cost Hamilton his life. The most famous duel in American history would never have taken place if Burr had been president.

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A Question for Petraeus on the Palestinians

Senators will likely seize upon the confirmation hearing for General David Petraeus to be CIA director as an occasion to debate the value of enhanced interrogations. The bin Laden hit should have put that debate to rest, but it remains a political football, and many senators just cannot let it go. Still, as President Obama has managed to put the Palestinian-Israeli conflict front-and-center again, driving massacres in Libya, Syria, and Yemen, and Egypt’s shaky outlook at least temporarily out of the headlines, senators might productively use the confirmation hearings to flesh out the views of both accomplished men on key issue of peace process policy.

One of the Clinton administration’s more disastrous moves, for example, was to use the CIA to monitor and, in some cases train, Palestinian security forces. The problem with CIA involvement is twofold: First, it erodes the already tenuous wall between intelligence and policy; and second, for the CIA operative on the ground, peace is less a priority than access. This in turn leads to protection of certain men as sources, regardless of the crimes they commit.  CIA involvement in the militia-training may lead it to turn a blind eye to bad apples, so long as they have loose lips and open palms. During and after the Clinton era, some elite Palestinian security men applied lessons from their training to build a new generation of better-trained terrorists.

General Petraeus, of course, has a storied history in Iraq and Afghanistan. He has never refused to take on the tough assignments, and refused to shy away from missions which many other men dismissed as impossible or dead end. In both Iraq and Afghanistan, Petraeus has embraced the creation of local forces and sub-national militias. Before he moves onto this new and important post, it might behoove the Senate to ask Petraeus to assess Clinton’s approach, and to discuss what lessons learned, if any, from his Iraq and Afghanistan experience he would apply to the Palestinian-Israeli conflict. Regardless of how he responds, his answer will be illuminating.

Senators will likely seize upon the confirmation hearing for General David Petraeus to be CIA director as an occasion to debate the value of enhanced interrogations. The bin Laden hit should have put that debate to rest, but it remains a political football, and many senators just cannot let it go. Still, as President Obama has managed to put the Palestinian-Israeli conflict front-and-center again, driving massacres in Libya, Syria, and Yemen, and Egypt’s shaky outlook at least temporarily out of the headlines, senators might productively use the confirmation hearings to flesh out the views of both accomplished men on key issue of peace process policy.

One of the Clinton administration’s more disastrous moves, for example, was to use the CIA to monitor and, in some cases train, Palestinian security forces. The problem with CIA involvement is twofold: First, it erodes the already tenuous wall between intelligence and policy; and second, for the CIA operative on the ground, peace is less a priority than access. This in turn leads to protection of certain men as sources, regardless of the crimes they commit.  CIA involvement in the militia-training may lead it to turn a blind eye to bad apples, so long as they have loose lips and open palms. During and after the Clinton era, some elite Palestinian security men applied lessons from their training to build a new generation of better-trained terrorists.

General Petraeus, of course, has a storied history in Iraq and Afghanistan. He has never refused to take on the tough assignments, and refused to shy away from missions which many other men dismissed as impossible or dead end. In both Iraq and Afghanistan, Petraeus has embraced the creation of local forces and sub-national militias. Before he moves onto this new and important post, it might behoove the Senate to ask Petraeus to assess Clinton’s approach, and to discuss what lessons learned, if any, from his Iraq and Afghanistan experience he would apply to the Palestinian-Israeli conflict. Regardless of how he responds, his answer will be illuminating.

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All Politics Are Local, Except when It Comes to Israel

Although foreign policy issues such as Israel play a not insignificant role in elections for the House and Senate, it isn’t every day that a county commissioner’s race becomes embroiled in the Middle East peace process. All politics may be local, but it appears that in at least one race for countywide office in Pennsylvania, Republicans are attempting to use support for Israel as a wedge issue. Two GOP candidates for commissioners of Montgomery County outside of Philadelphia are calling out one of their Democratic opponents on his role as President Obama’s chief local apologist in the Jewish community during the 2008 presidential campaign.

Republicans Bruce L. Castor Jr. and Jenny Brown issued a press release last Friday condemning President Obama for his demand that Israel accept the 1967 lines as the starting point for future Middle East peace negotiations. But they didn’t stop at criticism of Obama. The two specifically demanded that Democrat Josh Shapiro join them in their blast aimed at the president. So far, Shapiro has no comment on the challenge.

The reason for this maneuver is that Shapiro, a member of the state legislature, was one of the few prominent Philadelphia-area Democrats who endorsed Obama early in 2008 when most area pols were backing Hillary Clinton. After Obama won the nomination, Shapiro then spent most of the rest of the campaign speaking on the candidate’s behalf to Jewish audiences and reassuring them of Obama’s steadfast support for Israel. Republicans now appear to be saying that Shapiro should pay the price for what supporters of Israel rightly consider Obama’s efforts to distance the United States from Israel.

Not without justice some local cynics are branding this attack on Shapiro as probably the most brazen example of pandering to pro-Israel opinion on record. Shapiro is a highly affiliated member of the Jewish community (full disclosure: our children have attended the same Jewish day school and camp) so it’s not likely that too many Jewish Democrats are going to abandon him because of his past ties to Obama even if it seems as if his 2008 promises on the president’s behalf were checks he couldn’t cash. Indeed, even some Republicans are likely to think this jibe to be a bridge too far.

Nevertheless, the willingness of even county commissioner candidates to speak out against Obama’s stands on Israel is testimony to the seriousness with which Republicans are viewing this matter. Although the use of Israel as a wedge issue in local politics may be more than questionable, it may be a prelude to far more intense and less dubious attempts to call Democrats to account for their attitude of their party’s leader to the Jewish state.

Although foreign policy issues such as Israel play a not insignificant role in elections for the House and Senate, it isn’t every day that a county commissioner’s race becomes embroiled in the Middle East peace process. All politics may be local, but it appears that in at least one race for countywide office in Pennsylvania, Republicans are attempting to use support for Israel as a wedge issue. Two GOP candidates for commissioners of Montgomery County outside of Philadelphia are calling out one of their Democratic opponents on his role as President Obama’s chief local apologist in the Jewish community during the 2008 presidential campaign.

Republicans Bruce L. Castor Jr. and Jenny Brown issued a press release last Friday condemning President Obama for his demand that Israel accept the 1967 lines as the starting point for future Middle East peace negotiations. But they didn’t stop at criticism of Obama. The two specifically demanded that Democrat Josh Shapiro join them in their blast aimed at the president. So far, Shapiro has no comment on the challenge.

The reason for this maneuver is that Shapiro, a member of the state legislature, was one of the few prominent Philadelphia-area Democrats who endorsed Obama early in 2008 when most area pols were backing Hillary Clinton. After Obama won the nomination, Shapiro then spent most of the rest of the campaign speaking on the candidate’s behalf to Jewish audiences and reassuring them of Obama’s steadfast support for Israel. Republicans now appear to be saying that Shapiro should pay the price for what supporters of Israel rightly consider Obama’s efforts to distance the United States from Israel.

Not without justice some local cynics are branding this attack on Shapiro as probably the most brazen example of pandering to pro-Israel opinion on record. Shapiro is a highly affiliated member of the Jewish community (full disclosure: our children have attended the same Jewish day school and camp) so it’s not likely that too many Jewish Democrats are going to abandon him because of his past ties to Obama even if it seems as if his 2008 promises on the president’s behalf were checks he couldn’t cash. Indeed, even some Republicans are likely to think this jibe to be a bridge too far.

Nevertheless, the willingness of even county commissioner candidates to speak out against Obama’s stands on Israel is testimony to the seriousness with which Republicans are viewing this matter. Although the use of Israel as a wedge issue in local politics may be more than questionable, it may be a prelude to far more intense and less dubious attempts to call Democrats to account for their attitude of their party’s leader to the Jewish state.

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